Rent and other charges
The 2016 Act tells you how you can increase the rent and what other charges you can make.
If your tenant makes any rent payments in cash, you have to give them a written receipt saying how much was paid and how much they still owe you.
Increasing the rent
If you want to increase the amount of rent your tenant pays you, you have to give at least three months' written notice before you can do it. You must use the correct form to give your tenant notice of a rent increase — a 'landlord's rent-increase notice to tenant(s)'. You can use the Scottish Government’s ‘Create a Rent-Increase Notice ’ tool to create a Rent-Increase Notice which you can download and give to your tenant.
The notice period begins on the date the tenant gets the notice, and ends three months after that date (on the same day of the month — see example 1) or, if there is no such date, the last day of the month (see example 2). If you send the rent increase notice to your tenant by post or email, you must allow the tenant 48 hours to receive it. This delivery time should be factored into the amount of notice you give your tenant.
If you send your tenant a rent increase notice by recorded delivery post on 23 January, they will be expected to receive the notice on 25 January; the three-month notice period will start on 25 January and end on 25 April, so the earliest date a rent increase could take effect would be 26 April.
If the three-month notice period starts on 30 November, the end date of the notice period would be 28 or 29 February (depending on whether it was a leap year), and the earliest date a rent increase could take effect would be 1 March.
If your tenant disagrees
If your tenant thinks the rent increase is too high, they are allowed to contact a rent officer within 21 days of getting your notice.
They must tell you if they are doing this by returning Part 3 of the rent increase notice to you.
The rent officer has the power to decide what the rent for the property should be and can vary the rent up or down. The rent officer will aim to send you a copy of their decision within 40 days of receiving the tenant's fully completed application.
If you or your tenant disagrees with the rent officer's decision you can ask them to reconsider it, or appeal to the First-tier Tribunal, who will make a final decision, which may agree with the amount set by the rent officer or be higher or lower. If you want to appeal to the Tribunal, you must do this within 14 days of the rent officer's decision.
Other than the rent, you can ask your tenant to pay a refundable deposit.
This deposit can be no more than two months' rent.
It's an offence to make your tenant pay any other:
- administration fees
- further deposits
- additional charges, whether they're refundable or not
Rent pressure zones
If a local council thinks rents are rising too much in a certain area, they can apply to Scottish Ministers to have that area designated as a 'rent pressure zone'.
This means a cap (a maximum limit) is set on how much rents are allowed to increase for existing tenants each year in that area.
Local councils can apply to have an area turned into a rent pressure zone if they can prove that:
- rents in the area are rising too much
- the rent rises are causing problems for the tenants
- the local council is coming under pressure to provide housing or subsidise the cost of housing as a result
What the rent cap might look like
Any cap set by Scottish Ministers will be at least consumer price index (CPI) plus 1% – for example if CPI is 1.6%, the minimum cap set by Ministers would be 2.6%.
The cap can last for up to five years and will apply to existing tenants only.
The Rent Pressure Zone Requirements for Local Authorities document guides local authorities on the requirements of an application to Ministers and provides details of the robust evidence required.
Applying for additional rent to reflect improvements
If your property is in a rent pressure zone, you can apply to a rent officer for an additional amount of rent to reflect any improvements you have made to the let property.
These improvements don't include:
- any repairs or maintenance
- decorative work
- any work done which was entirely or partly paid for by the tenant
After you apply to the rent officer, they will send a copy of the application to your tenant. They will have 14 days to respond.
Before the rent officer decides on the amount you can add to the rent, they will send you and the tenant a draft of the proposed decision. They will aim to send you this draft decision within 35 days of receiving your fully completed application form.
If you want to respond to this, you have 14 days. Your tenant will then get a copy of your response, and have 14 days to reply.
The rent officer has to take all responses into account when coming up with a decision. The rent officer's decision is final and can't be appealed.